March 27, 2009

On Emanuel's watch, the board was told by executives of a plan to use accounting tricks to mislead shareholders about outsize profits the government-chartered firm was then reaping from risky investments. The goal was to push earnings onto the books in future years, ensuring that Freddie Mac would appear profitable on paper for years to come and helping maximize annual bonuses for company brass.

The financial trickery eventually led Freddie Mac to the brink of insolvency. It had to be bailed out by the Bush administration and the Obama administration has pledged to continue supporting it.

This is just one more case of the cozy, unholy trifecta of Washington power, Wall Street money, and a bamboozled American public.